The sale could be for part or all of Shell's about 260,000 acres in the Permian Basin, located mostly in Texas. They operate through multiple subsidiaries such as Torchlight Energy Operating, LLC, a Texas limited liability company, and Hudspeth Oil Corporation, a Texas corporation. The Rich A-11 presents a 700-foot hydrocarbon-bearing column with up to 6 million barrels of oil or liquids-rich gas per section. $23,529. Reddit and its partners use cookies and similar technologies to provide you with a better experience. Prices per acre can range from $10,000 to $60,000 in Texas. We, Yahoo, are part of the Yahoo family of brands. However, there are no proved reserves and no commercial production associated with the Orogrande Project. Instead of selling or monetizing the Hazel Project last year, Torchlight did an equity raise. We specialize in the technology and healthcare sectors. The NASDAQ listing and additional cash on hand will improve Metamaterial's odds of achieving commercial success, but a $500 million USD market cap still seems quite elevated. With over 20 years of investment banking experience, including 5 years as a fund manager, prior to becoming a consultant, Mr. Brda has the knowledge and experience to execute and ensure success for his client companies. By clicking Accept all you agree that Yahoo and our partners will process your personal information, and use technologies such as cookies, to display personalised ads and content, for ad and content measurement, audience insights, and product development. Torchlight offers 168,000 contiguous acres in the heart of the Orogrande and has executed a five-year drilling lease with a second five-year option with the state of Texas University Land System. Within Radius. Reproduction in whole or in part, in any form or medium without express written permission is prohibited. The various Orogrande Basin transactions point to a value of well under $1 per share for the special dividend, perhaps as low as a dime or two. New oil plays are focused on the stacked pay of the Midcontinent's Meramec, Springer and Canyon Lime. Another Texas operator sought to increase is Permian Basin presence as Fort Worth-based FireBird Energy bought about 21,000 acres in the eastern Midland sub-basin in West Texas from Chevron USA. Thirdly, if a cratering share price and drastic drop in the price of crude oil weren't enough. /property/Oro_Grande_x5-4654244/ Nelle Ave Orogrande, NM, 88342 Torchlight is targeting operators with successful Delaware Basin horizontal experience to join in as a 50/50 partner to complete the test. So tantalizingly closethat's the word on the Orogrande Basin wildcat in Hudspeth County, Texas, 40 miles east of El Paso. Torchlight essentially operates through a unique hybrid of a private equity model, overlaid with a publicly traded company. Is my math way off? Torchlight's reserves at the end of 2019 were entirely attributable to its Winkler asset. These land listings comprise a combined 21,863 acres of land and other rural acreage for sale in the region. You don't have to worry about squaring the measurement, because an acre is already considered to be a squared number. Following his time at Energy & Engine, Mr. Wurtele served as the CFO of Xtreme Oil & Gas, Inc. Xtreme Oil & Gas, Inc. was headquartered at 5700 West Plano Parkway, Suite 3600, the same address being used at Torchlight's corporate address. This info is straight from https://www.torchlightenergy.com/current-projects/orogrande-basin, https://www.torchlightenergy.com/current-projects/orogrande-basin. That rig was there on the Orogrande in early 2018. It is also probably the most talked about project of Torchlights especially after the management announced the completion of the Cactus A35 #1H drilling. I believe the $17.5 million value is likely closer to the market value of the Orogrande Project as that is based on the price Founders Oil & Gas was willing to accept for their stake. However, according to Mr. Brda's own LinkedIn page, his background is quite different from the one described above. On June 12, 2018, Nobilis Health Corp. filed a malpractice lawsuit in Houston, Texas against Briggs & Veselka. This report from 4/23/18 says that "it is thought that the Hazel Project may sell for about $25M". Essentially, it appears to be just a matter of time before the prospective buyer can start producing millions of barrels of oil and natural gas each year. Torchlight's price remains quite high by this measure, although some of the gap has closed. Most people have it growing at about [a rate of] 800,000 barrels per year. One Metamaterial share is around $3.00 USD and that gets you 3.3 Torchlight shares (around $0.91 USD per Torchlight share). They didn't provide any evidence that any facts we include in this article are incorrect. Before, Torchlight was looking to participate in drilling activities. There are . I am not receiving compensation for it (other than from Seeking Alpha). . Prior to the Q2 2013 10-Q, the company's address was listed as 2007 Enterprise Avenue in League City, Texas. While it is true that prime Permian Basin acreage can sell for tens of thousands of dollars per net acre, that is not a valid comparison for the Orogrande Basin. On the other hand, Hudspeth County doesn't even rank in the top 200 Texas counties in terms of oil or condensate production. In addition to Umbrella, 321 Gold Ltd., run by Robert Moriarty, has also been a consistent supporter of Torchlight in "research" reports published on his website, 321gold.com. Although Mr. Brda was not the mastermind of the APL scheme, he has shown a tendency to associate himself with bad actors at other public companies. As a result of the sudden progress and M&A hopes, Torchlight's stock has appreciated 200% year-to-date, closing at $1.59 per share on April 23, 2019. Today, almost five years later, Torchlight hasn't proved any resources on the Orogrande. Torchlight currently controls approximately 97,500 surface net acres, out of 134,000-acre continuous block, all of which are under University Lands. Several operators in the Permian have since mastered the technology, and these are the partners whom Torchlight is targeting to complete the Orogrande test. Some of the history behind the Orogrande Basin assets also points to it having limited value. September 16, 2019 by PBOG. Torchlight's Winkler Project sale involves a . History and geology appear to be in alignment for a new tight oil play. The price per acre for the Midland Basin was about $17K. Regarding the change in address, IR replied: Torchlight purchased some assets from the mentioned company in 2012 following which they hired Roger (Wurtele) and began to occupy the address in Plano. The Permian-Delaware basin is still valued at $30,000 per . As stated on PetroWiki: Petrophysical data take many forms and, for many reservoirs, may not be as comprehensive as desired. The deal closed on Dec. 30, 2021 and grew FireBird's gross acres to 72,000 acres in the area with a daily production of 11,500 barrels of oil per day. Permian Basin is the only . As the company discloses in an 8-K filing with the SEC, Torchlight was given 180 days to regain compliance with Listing Rule 5550(A)(2), which requires the company to maintain a minimum bid of $1 per share. Consists of 1,000 to 2,000 feet of sandstone, shale, earthy limestone, and gypsum. Orogrande Basin Lease was bought in 2014 for 850k shares at 3.5 dollars, with 100k in cash with 75% interest! . Prior to his time at Torchlight, Mr. Wurtele served as the CFO of Xtreme Oil & Gas, Inc. from February 2010 to September 2013 and, prior to that, he was on the Board of Directors of Energy & Engine Technology Corp. Interestingly enough, Energy & Engine Corp. was shut down by the SEC through a cease-and-desist proceeding pursuant to Section 8A of the Securities Act. Browse LandWatch's Texas land for sale page to find more rural . See the 3rd party verified return on each of our bearish reports over the last 24 months at: https://breakoutpoint.com/as-summary/white-diamond-gvmtg/To inquire about becoming a premium subscriber, send a PM here or email us at research@whitediamondresearch.com.Follow us on twitter @whiteresearch. Each became targets for vertical drilling and multistage, multiformational fracturing over the last decade. Torchlight is currently running low on cash and living off credit. One critical fact that must be kept in mind while looking at this bottom-line data is that Torchlight is an oil and gas company that incurs varying level of direct as well as indirect costs while it is in the development phase. The company's entire perceived value is based on possible oil in its Orogrande Project. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. The other good point is that these institutions have held on and this is evident from the fact that the institutional holding actually went up even with spike in price around March 2019. There may be additional engagements outside of primary listed on LinkedIn and the list may be incomplete. Browse Orogrande, New Mexico properties for sale on Land.com. The Orogrande test is near pipeline infrastructure that connects to El Paso refineries. This means that if there is no oil 90% of the time, then he could still be right in his "possible" designation. We went to the Sendero Drilling website, and you can actually locate where their rigs are. Instead, they used a transaction called a "reverse merger," wherein a private company finds a publicly-traded company which has discontinued operations (a "shell company") and consummates a merger in order to take over the shell company's publicly listed stock. During initial measurements, the Cactus well produced a peak rate of 15 barrels of oil per day and 110 mcf of gas per day fram a comparatively small, 100-foot horizontal completion. Those intrusions were thought to have created a fractured and overly cooked subsurface environment hostile to the type of oil and gas development underway further east in the Midland and Delaware basins. Especially when all the infrastructure is already built. Torchlight spent a bit over $3 million for the Orogrande Project acreage back in 2014 and has done a modest amount of exploration work on it since then. Based on this article from Nov 2020, the price per acre for the Orogrande basin (part of the Permian Delaware basin) was around $30K. In the Permian Basin, a prospect is to be drilled soon in the lightly explored Orogrande Basin. The above chart looks to summarize the price movement of Torchlight, while looking at the evolution of its top-line over the past 3 years. . @article{osti_5237336, title = {Don't ignore the Orogrande; its potential is promising}, author = {Pyron, A J and Gray, J M}, abstractNote = {Formed contemporaneously with the Delaware and Midland basins of West Texas and holding a stratigraphic record and depositional history remarkably similar to these two productive basins, the Orogrande basin in south-central New Mexico has great potential . TRCH has little cash with increasing debt, and if it cannot sell the Orogrande, we believe the company is finished. But in July, Plano, Texas-based Torchlight Energy Resources Inc. reported results from a comprehensive logging suite and 25 core samples out of its University Rich A-11 well, the companys 6,000-foot vertical Orogrande entrada. SAN FRANCISCO, CA-- (Marketwired . Get them exclusively at Distressed Value Investing. I have no business relationship with any company whose stock is mentioned in this article. ROTH rates the company a Buy. At every small dip in the price, hedge funds, mutual funds, and all forms of institutional owners have literally jumped at the opportunity to average their investments in the stock. Mr. Moriarty's articles occasionally appear on Streetwisereports.com, as well - here is another "research" report Moriarty wrote on TRCH. Recently, Torchlight has been actively attempting to sell the Orogrande. Mr. Brda also has a checkered past. You can change your choices at any time by visiting your privacy controls. Elephant Analytics has 15 years of analytical experience and unique skills in numerical analysis and practical mathematics. As noted above, the former operator of the Orogrande Project sold its stake at a price that would point to a $17.5 million value for Torchlight's current stake. I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. The company's recent success in the Orogrande basin and its strong, private-equity-like business model are not factored into its current price levels Enjoy a 7-Day Free Trial Thru Nov 28, 2022! Has House? Salesparq, LLC which ownsSmallcapsDaily.comisnt registered with any financial or securities regulatory authority and doesnt present nor claims to produce funding suggestion or recommendations to readers of this launch. Subscribe for free to our newsletters for the latest energy news. April 05, 2017 08:45 ET | Source: Streetwise Reports. Torchlight's special dividend is likely to have limited value though. I am not receiving compensation for it (other than from Seeking Alpha). Gary_L_Hutchinson April 5, 2017, 9:22pm #5. Under a new law proposed by House Republicans, that price would go up to more than $2.50. Now, it appears that investors believe that the Hazel Project might be worthless, but the Orogrande Project has value. . Cookie Notice Torchlight still appears significantly overvalued based on the percentage of the post-combination company it will own, although the valuation gap has closed a fair bit over the last few weeks. "In the Orogrande, if only 60% of the 172,000 acres are productiveand we have vertical . In November 2007, Mr. Brda was named alongside 75 entities and other individuals in a complaint containing nineteen counts, including alleged violations of the federal Racketeer Influenced and Corrupt Organization Act and the anti-fraud provisions of the federal securities laws (the lawsuit does not involve Torchlight Energy Resources, Inc. in any way). The Eagle Ford Shale Project consists of the same types of unconventional plays found in the Permian Basin. In Arizona, the price is about . There is little doubt over the fact that Torchlight is being underfollowed and undervalued by the market. Since commencing operations in 2013, the company has generated only $10.7 million in revenue while incurring $52.8 million in operating expenses and paying $14.4 million in interest expense, for a cumulative net loss of $83.9 million. Mr. Brda, who also co- founded the Company, has been the Managing Member of Brda & Company, LLC since 2002, which provides consulting services to public companies - with a focus in the oil and gas sector. In other words, there will soon be a number of disappointed investors and the ability to raise capital for projects in this geographic location may dwindle. Texas allows for single drilling and development units. If you do the math on that it lands somewhere around $750m barrels total. However, analysts are expecting to range from anywhere between $1 per share and $20 per share. Torchlight offers 168,000 contiguous acres in the heart of the Orogrande and has executed a five-year drilling lease with a second five-year option with the state of Texas University Land System. Prices for top E&P stocks and commodities. This is just a rough estimate based on the latest information I found, but if accurate it still points to Metamaterial's shares being significantly cheaper than Torchlight's shares if one wanted to invest in the new company. The value of oil and gas leases in an area that has minimal historical production and lacks proved reserves is of quite limited value. Shares even hit the $2 target on . It appears that he has employed a similar strategy at Torchlight. Ready to build zoned SR-43 (single family residential) lot. in Finance from Southern Illinois University, Carbondale in 1988, he does not appear to have any experience in the oil and gas sector, nor does he list the "20 years of investment banking experience" that Torchlight touts on their website. All rights reserved. We are short Torchlight Energy Resources, Inc. (TRCH) because we believe it is a classic pump-and-dump run by a questionable management team in our opinion, with some of the leadership having previous run-ins with securities regulators. He was promoted to CEO in December of 2014 with the exit of our co-founder Tom Lapinski. Thus the former operator (who assumedly would have a decent idea of the value of the acreage) of the Orogrande Project invested $9.5 million in the project, but ended up selling its stake for $2.5 million. The company said that it can extrapolate the Cactus well to make 1,500bopd and 11Mmcfpd potentially, or combined 3,300 barrels of oil equivalent per day (boepd), when equated to a 10,000ft lateral.
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